Up the Sleazy River At the Dallas City Hall Corruption Trial

Carol Reed, political consultant to Mayor Tom Leppert, has been mentioned a lot in the City Hall corruption trial in federal court, inspiring what looks a lot like a bit of damage control from the mayor.

Mark Graham

Aghast at the river of sleaze oozing out of the Earle Cabell Federal Building in the past two months, reformers on the Dallas City Council have called for a system of registration for local lobbyists. Great idea. Much of the testimony in the Dallas City Hall corruption trial in federal district court has involved so-called political consultants who get paid to swing council votes in favor of the people paying them. It's a good issue. It's just not the best issue. The underlying problem at City Hall isn't lobbying. It's influence-peddling and patronage. That's the cancer.

Part of the evidence in the trial is that former Dallas City Council member Don Hill's girlfriend at the time, Sheila Hill, nee Farrington, was paid $175,000 as a political consultant by a developer who was seeking zoning changes from Don Hill. I believe in political terms that's what you would call the direct connection.

Had there been a registration law for lobbyists in effect five years ago when the events in the trial took place, then presumably Farrington-Hill would have been required to hike down to the city secretary's office and sign on the dotted line. Testimony at the trial from longtime lobbyists at City Hall indicates all of them would have taken a gander at the list the next day and said, "Sheila who?" From there, one assumes, some degree of transparency might have transpired.

That's why city council member Angela Hunt this week persuaded four other council members—Jerry Allen, Pauline Medrano, Ann Margolin and Linda Koop—to sign a letter to the city attorney asking him to research registration laws in Austin and other cities.

"I don't think this will put an end to graft or corruption," Hunt told me. "I think that would be naïve and overly idealistic. But I think it can provide transparency."

The morning after Hunt sent her letter to the city attorney, The Dallas Morning News reported that this actually had been Mayor Tom Leppert's idea all along. I guess he wanted it to be a surprise. I know it was for me, especially since Leppert's own chief political advisor has been mentioned frequently in the trial without any notable comment from the mayor. More on that in a moment.

The real lobbyists don't object to a call for simple registration, as long as it doesn't turn into an attempt to shut down lobbying. I spoke with Willie Cothrum, proprietor of one of the city's oldest, most respected lobbying firms, Masterplan. "We don't have any problem at all with a plan for registration," he said. "I don't necessarily see the need for it. The people we deal with know who we are."

But Cothrum indicated he'd sign up without a hullabaloo as long as the requirements didn't include a lot of questions probing into proprietary matters, like who talked to whom about what before anybody even gets a deal going. And I think we all get that.

Politics in Dallas is 98 percent real estate. Real estate is about trying to be where the crowd's going to be later, before the crowd knows it's going. Or, as they say in real estate school, "Deception, deception, deception."

If you have to telegraph your punches, you might as well not bother punching. Requiring people to provide information that will give away their strategies is like telling people they have to go down to the police station and fill out a report whenever they think they might be falling in love.

Require away. Ain't gonna happen.

But a basic law saying that people who get paid to influence City Hall need to make themselves known by registering is really only a way to put lobbyists on a more equal footing with ordinary citizens. Hunt said, "You know when folks come up to City Hall, an average everyday citizen neighborhood activist, they come up and they stand at that microphone. What's the first thing they have to do? They have to give their name and address. It's a matter of public record if you appear before the city council.

"Well, why wouldn't we help ensure transparency in other ways when people are speaking to us behind closed doors, especially when they are paid lobbyists?"

So registration would help the public know who's a paid lobbyist. The deeper question of influence and patronage probably is not as susceptible to regulation.

We're not talking about bribery. At least I'm not. Bribery is a major topic of conversation right now at the federal building, and in another couple months we'll find out how the jury feels about it.

I'm talking about a machinery of patronage, perfectly legal and very powerful, linking some of the top ad agencies and political campaign runners in town with the mayor and the Citizens Council, the private business group that used to handpick the city council before a ruling in a civil rights lawsuit outlawed the old at-large council system. This machinery exercises great influence over public works decisions, the distribution of public works contracts and the raising of political money. In this entire nexus, taken together, you wind up with a whole lot of leverage.

Two weeks ago the trial provided an especially raw little moment, a window through which we were able to steal a peek at this power and how it works. In September 2004, then Mayor Laura Miller stirred up a storm when she learned that a housing developer seeking approvals from the late council member James Fantroy was going to dish a bunch of work to Fantroy's private security firm.

The council rushed into a secret "executive session," after which Dallas City Attorney Madeleine Johnson ruled that the developer could give Fantroy the contracts legally. One reason we have a federal corruption trial going on today is that the FBI, when it got word of the deal, disagreed with the city attorney.

But let's take ourselves back to that moment and try to imagine the mood behind closed doors in the city council offices. The city attorney has given the council some kind of ruling or opinion to the effect that it's OK for a guy seeking a zoning vote from a councilman to pass a lot of money to the councilman through business contracts.

The mayor of the city, on the other hand, thinks it stinks. But the establishment has its own agenda and wants to keep things running smoothly. Fantroy was a reliable source of votes for establishment projects and deals.

So if we imagine ourselves in that warren of city council cubicles, we are at a kind of crossroad, a little beyond the reach of the law. The city attorney says it's OK. The mayor says it stinks. How do we feel? Even if we believe we are all right by the law, we still have a decision to make that is political and moral.

This is the moment when Carol Reed steps in. Reed, founder of The Reeds Public Relations Corp., has run the successful mayoral campaigns of every establishment mayor since 1981—Jack Evans, Starke Taylor, Annette Strauss, Ron Kirk and the incumbent, Tom Leppert. She ran the campaign for the city's 2006 bond campaign, the largest in history.

Reed is a direct conduit to the Citizens Council. The Citizens Council and its members remain without peer as sources of campaign funding in the city.

At that fateful moment in 2004, when the council was deciding what to do about Fantroy and his security guard contracts, Reed also was working as a paid lobbyist for Bill Fisher, the developer in question then and the main government informant and witness now in the ongoing corruption case.

Reed's agreement with Fisher was that she would be paid $100,000 if she could win council approval of three of his affordable housing projects. She has not been called to testify in the trial. She told me this week she was not working for Fisher when the contracts were initially awarded to Fantroy.

But testimony in the trial has established that Reed advised Fisher not to pull the contracts after Miller exposed them. Keep the juice flowin'! The council agreed.

In the corruption trial, the defense is hitting Reed's role in this incident hard as an illustration of a double standard. When Fisher was on the stand, Victor Vital, attorney for Sheila Farrington Hill, asked him about Reed's role:

"Do you know that the FBI never wiretapped her phone?" Vital asked Fisher.

"I don't know that," Fisher said.

"Did you know that the Federal Bureau of Investigation never investigated Carol Reed, the well-known political consultant here in Dallas? Is Carol Reed a defendant in this courtroom?"

"No."

With that, Vital passed the witness.

So let me say this. I don't believe there is a scintilla of evidence that Carol Reed broke any law when she gave Fisher the advice she did. Reed is a tough player at times, but she's honest. And she's right. If the city attorney said do it, she was within her rights to say do it.

But how many average voters in Dallas realize that things get done this way, with the blessing and imprimatur of the one person who more than anyone else in town represents the political face of the establishment?

Reed talked to me about it. She said: "All I know is the city attorney ruled on those contracts. Whatever the city attorney said, that would be my advice.

"It's been too long ago. I talked to the FBI long before the indictments were even brought down. And I am just not even close to it. I have no desire to get in the middle of it now."

Reed said she would have no objection to a law calling for lobbyists to register. "I have absolutely no problem with filing. Anybody knows that when I come down there, I'm getting paid."

I asked her if her proximity to the mayor might put her in a special category. She said: "Not any more than if I worked on the governor's race and I was lobbying in Austin. That's what I do for a living. I've been down there for years. Everything is about being transparent."

I asked Mayor Leppert, through his staff, whether he believes it is appropriate for his own key political advisors and campaign runners to be paid lobbyists before the city council. As usual when I ask him tough questions, Leppert did not respond.

The larger issue of influence and patronage is one that will have to be settled someday at the polls. I guess Mayor Leppert, if he could speak, would say it already has been.